Rethinking resilience in the face of extreme heat

With the Northern Hemisphere's summer just behind us, residents of nearly every continent are still feeling the burn of extreme heat. For the contiguous United States, the June-through-August period in 2026 marked the warmest summer in 131 years of record-keeping. While temperatures in June in the United Kingdom topped 37 degrees Celsius, it was even hotter that month in western China, where the mercury approached 47 degrees.

While hurricanes and earthquakes often capture the headlines, heat is a different breed of risk for insurers and society: silent, pervasive and increasingly deadly. People living through heatwaves endure added strains that drive up mortality, but this risk goes further, settling into the built environment where it can damage infrastructure, interrupt energy supplies, transportation and supply chains, and undermine economic systems.

In a new report, Rethinking resilience in the face of extreme heat, Swiss Re Public Sector Solutions experts examine the unique features of this evolving risk while highlighting ways to respond, including with innovative risk-transfer opportunities. These can help governments and other organisations manage the impacts of heatwaves that scientists say are more intense and frequent as the atmosphere warms.

Insurance in isolation won't solve the challenge posed by extreme heat. Like all insurance products, risk transfer must be deployed as an element of a broader resilience strategy that prioritises effective adaptation approaches. These can include climate shelters, urban cooling programmes and heat-resistant building materials designed for a hotter century.

Alongside such measures, risk transfer is an important pillar of a comprehensive heat response framework. Parametric insurance relying on increasingly sophisticated triggers that serve as proxies for insured losses has already been deployed in diverse markets to provide financial relief, helping affected communities and organisations respond swiftly to the impacts of extreme heat:

• Starting in 2023, the SEWA heat insurance programme has provided nearly 50,000 self-employed female workers with financial protection during extreme heat conditions, as part of an effort to provide relief to groups working as street vendors, in agriculture or in other occupations where soaring temperatures threaten their health.
• In a city in the US Southwest, a parametric insurance solution has provided rapid, transparent funding when sustained heat waves exceed pre-agreed thresholds, helping the city respond when heat creates acute pressure on vulnerable residents, public services and local infrastructure.

The trend is clear: the World Meteorological Organization forecasts an 86% chance that at least one year between 2026 and 2030 will surpass 2024 as the hottest on record, continuing a period of exceptional global warmth. In combination with adaptation measures, insurance can help address the financial strain of extreme heat by transferring risk and sending valuable financial signals about the effectiveness of our efforts to reduce exposures and build societal resilience.